How to work with clients and iterations in an Agile team?

This stream is a continuation of my previous one . These are actually 2 questions, so I hope that no one will mind, since they depend on each other.

We start a new project at work, and we see it as a great opportunity to try Agile methods in action. We had a brainstorming of the ideas that we read in several books and articles, and came up with a concept that would suit us best: 2 weeks of iteration, and then call customers who will choose what they want to have at the next iteration. I just have a few more questions that we could not understand ourselves.

What to do on the first iteration?

What, in general, to do in the first few iterations, if we start from scratch? Just give it a month of development to encode the core of the application or start with simple wired frames with limited pre-encoded functionality? What do customers usually want to see? Brilliant things that don't work or ugly things that work?

How to communicate with customers?

At first, we thought that the process should be something like this:

alt text http://img690.imageshack.us/img690/2553/communication.png

Is it good to have a focal point on the client side or is it better to communicate with all clients to prevent misunderstanding?


Any thoughts are welcome! Thanks in advance.

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